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tv   The Kudlow Report  CNBC  March 15, 2013 7:00pm-8:00pm EDT

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at a hertz expressrent kiosk, you can rent a car without a reservation... and without a line. now that's a fast car. it's just another way you'll be traveling at the speed of hertz. certainly have a lot to be thankful for for our eighth anniversary. i want to thank mark hoffman, president and ceo of cnbc who believed in me and said good
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larry kudlow. this is "the kudlow report". optimism is in the air. that's right. stocks are roaring. economic numbers better than anybody expected. new political dialogue in washington. that's right optimism and i'll try to make the sale to my pal coming from cpac. are young guns taking over and saving the conservative movement. there's a shift to more conservative and libraertarian. we learn about jpmorgan's massive and misguided london wale trade. you know it's okay to make a mistake. it's not okay to cover it up.
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remember, they were betting with taxpayer backed money because jpmorgan is still too big to fail. "the kudlow report" begins right now. first up, amidst all the negativity out there i believe optimism is in the air. the stock market record highs, the economy is picking up, president obama in a charm offensive because his polls are way down. in fact he's now talking corporate tax reform. even pushing democrats on entitlement reform or so he says. now i know, i know, my favorite president reagan trust by verify, but i think there's some optimism out there and i'm going to do my best now to persuade my pal, conservative superstar ann coulter. she's the author on set for the full hour. jimmy williams.
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and michelle caruso-cabrera. ann coulter, i know you think i'm nuts but i'm telling you the stock market is a great signal. the republicans won on the sequester. obama's poll are down so now he's having to come to the negotiation table. i like this story. i want to be optimistic about this story. >> um, i want to be optimistic too. but i want to be realist jig. all,000 are the financial maven and i would normally defer to you, that's the only thing i'm pessimistic about. i think the economy -- i would not count on the stock market continuing to go up. i know nothing about it. i just don't think that what's happening in the company justifies it. people don't have any other place to put their money. i do think people will get fed up with obama. one thing i'm very optimistic about which i was not before, i thought if we didn't repeal obama care in the next four years, if romney didn't win we
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would never repeal it. you are starting hear, you saw the donna brazil tweet i can't believe my insurance company just raised my rates. bad things are going to happen as obama care goes into place. it's not like medicare or social security where you get a check in the mail. bad thing will happen. you won't be able to see your doctor. you'll be thrown off your insurance plan. i still have hope we can repeal obama care and have a competitive system in health insurance. >> talked to paul ryan about this, okay, earlier this week. you know guys like ryan they are holding the line. i want to go back to this point. i think the republicans did the right thing in holding down spending on the sequester. the stock market had a big pop over that. i really liked that. second point, business is getting better. not washington. business is the reason why stocks are getting better. but here's the thing, go back to your obama care. >> don't worry, washington will stop that. >> i don't think so. see, i think the republicans are
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back now in their mold where they are most effective of stopping the bad stuff and then trying to push a little bit the better stuff. in other words, i asked ryan, right, the guy has lunch with obama. first time in four years plus. ryan, can you make a deal with this guy? can there be a grand design? should you try for a deal? ryan says yeah, i'm cautiously optimistic. he's coming to the table. i heard the same thing from senator johnson. guys are telling me that obama has got a completely different attitude now. i want to try to persuade you of that. things are possible. things may be moving out there. >> i agree with that. and by the way, back when they were setting up that sequester, you may recall some of the purists conservatives were denouncing republicans for agreeing to the sequester and they ought to just cut spending and they should just put their foot down and shut the government down. no i was for the sequester because i knew that wouldn't happen. the sequester has put
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republicans in a fantastic position. it's obama allowing the sequester to go into effect by refusing to do anything except for raise taxes. republicans have already raised taxes one time. that wasn't enough. now obama is still continuing to refuse to cut spending so the sequester really does put republicans in a good position and they are being smart sometimes, but i think people outside of washington have to understand and outside of, i don't know, the universe, the media is against us. there are some fights we can win, some fights we can't win and the fight on raising taxes on the top 1% or shut the government down, that wasn't a fight we could win. it wasn't a fight we could within. the sequester we have won. >> that's right. they took their licks. conservatives took their licks. it wasn't as bad as we feared. the spending cuts i think are terrific. look i don't think the country is in love with republicans. all right there's none of of that in the polling data make
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that very clear. i just think, again, i go back to the stock market. to me stocks discount the economy, profits and politics. and i think what stocks are saying is for whatever reason obama has come to the negotiating table. that by itself is a food thing. maybe something good could happen. maybe something small. at the very least nothing bad will happen. i think this is grounds for big optimism. i want to know at cpac is there optimism at cpac or does everybody have a long face? >> it's a mixed bag. i mean the november election was kind of rough, larry. and i think people are still coming out of that. you would be sort of nuts not to be demoralized as a conservative right now. the important thing this, will be in my speech tomorrow, it's very short but i'll try to make the point quickly is we need to figure out what the real mistakes were and not blame fake
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mistakes, so we don't screw up again. i can think of ten senate seats in the last two or three election cycles that republicans just pissed away. they were winnable seats. ted stevens, olympia snowe and then all of the abortion in the case of rape bone heads. i can't think of a single race that democrats just lost by being stupid or saying the wrong thing. they do not lose close elections. and republicans really need to concentrate on -- conservatives need to remember hot headness and passion are great but in politics all that matters is scoring >> you're right about that. just one other point. conservatism, optimism, growth. from what i learned working for ronald reagan as a kid many years ago, growth, jobs, wealth, your house, your portfolio, all the rest of it, how you live,
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ann. you know gop or conservatives got to talk a lot more about that thanl as you mentioned all this goofy stuff about rape and social issues which makes no sense at all. what i want to ask is to keep the optimism going or to restore the optimism are these people at cpac particularly the younger people talking a growth message, a growth message? >> um, i haven't seen much of it. um, but yeah. that seems to be -- certainly our elected republicans as you say like ryan like ted cruise like rubio. we can win -- we can win on various fights. we're going to win on guns. if we don't win on guns then look for big victories in 2014 and a big victory in 2016. even the most depressing polls on guns this is just one example where, you know, you get the soccer moms saying we should ban the guns.
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when they ask about intensity of their feeling on this it's the anti-gun people will you vote on this yeah. 20%. pro gun people 90% are voting on guns. this happened in 1994. if democrats are stupid enough to push these gun control measures, which are idiotic and will do nothing to stop manslaughter -- >> i got michelle caruso-cabrera. she wants to ask you a question. >> my twitter feed that i'm following that comes from cpac almost a war is going on there between the libertarian arm, the cal conservatives who are tired of the social conservatives controlling the agenda. am i reading that wrong or is that because who i follow on twitter? >> i've noticed -- i haven't been here that long. what you're describing is describing the conservative movement and republicans the way i see it right now. all of these pointless stupid fights and i hate to see
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right-wingers fighting so i've been ignoring it all. i really just do think it's a result of us losing the last election. it reminds me of what people say how professors at universities get in vicious fights. the fights are so vicious because the stakes are so low. we have one half of one branch of government and we're attacking one another. i wish they would stop that and look at the enemy and look at where the american people are with us. the soccer moms are with us on locking up the mentally ill. that's what's causing mass shootings, not the presence of a gun. we have issues we can win on. we're not going to win on the cabinet fights. they have the presidency and senate. we won't win on repealing obama care until we get a veto proof majority in the senate. there are fights we can win. >> got to leave it there. ann coulter you're great to help us. stay optimistic. optimists always yuan. now folks let's move on.
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more shocking details of the disastrous london wale trade. making a bad trade is one thing. but cover ups and too big to fail are not. we'll get the latest on this story from washington, d.c. free market capitalism is the best path to prosperity not crony capitalism, not bail outs, not too big to fail. i'm kudlow. we'll be right back. tdd#: 1-800-345-2550 seems like etfs are everywhere these days. tdd#: 1-800-345-2550 but there is one source with a wealth of etf knowledge tdd#: 1-800-345-2550 all in one place. tdd#: 1-800-345-2550 introducing schwab etf onesource™. tdd#: 1-800-345-2550 it's one source with the most commission-free etfs. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 one source with etfs from leading providers tdd#: 1-800-345-2550 and extensive coverage of major asset classes... tdd#: 1-800-345-2550 all brought to you by one firm
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it's become known as the london wale tread. the jpmorgan portfolio that racked up outstanding losses in excess of $6 billion. a new senate report accuses jamie dimon from holding back information from regulators. kate kelley joins us now with the details. >> reporter: good evening. in a six hour hearing senator carl levin took a very hard line with current and former jpmorgan executives, highlighting the risk management failure, fudged trading marks and ultimately misleading public comments the bank made as it was racking up more than $6 billion in losses last year. ina drew appeared close to tears as she described the jpmorgan job as her life's work and her resignation as devastating. also singled out for grilling
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douglas braunstein and in senator levin's view misled the public. >> senator, my obligation on the call and the only thing i was thinking about was reporting based on what i knew at the time, the information as accurately as i could. in hindsight, senator, the positions and the portfolio did not act as a hedge, it changed dramatically. we misunderstood the risks. we misunderstood the complication in it. we ultimately misunderstood what the estimated performance of it would be. so in hindsight we got that wrong. >> reporter: late in the day official from the office of the controller of the currency also took a stand painting a picture of an arrogantly managed bank
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whose executives including jamie dimon told it to effectively mind its own business at times. >> that's unacceptable premise that the bank decides what information is provided to the occ and our auditors. >> reporter: a bad day for jpmorgan. >> all right. many thanks kate kelley. look me make a quick take on this. i have nothing against risk taking or hedging or big profits or great compensation. no problem. but, big banks like j.p. morgan are not real free enterprise companies where risk wos be borne by investors. j.p. morgan is essentially a government-run utility. it's backed by taxpayer money because it's too big to fail. that is not free market callism. and taking big risks with taxpayer money is not my idea of good management. it's not a real business, folks.
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let's ask our distinguished guests. we have the former fdic. josh ross near, co-author of the "new york times" best certainly "reckless endangerment." joining me for the full hour strategist jimmy williams, cnbc's own chief international correspondent, michelle caruso-cabrera. bill isaac i understand you're going to defend jpmorgan. i don't know how you're going to do that but i would love to hear it. >> i didn't know i was going to defend jpmorgan. good to be with you. i will point out $6 billion is a lot of money to us but not a lot of money to jpmorgan. they even didn't have a down quarter when they absorbed these losses. so there's no question the bank had some serious problems in its risk controls and jamie dimon has admitted that. there's no question in my mind
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that the regulators were not at the top of their game either. we have a regulatory system that's badly fragmented, badly politicized. it was needed to be fixed. we also -- they also lame to have fixed too big to fail. they didn't. >> that's the key. and senator levin may have been responsible for not fixing too big to fail but he sees now with clarity that it still exists. josh i want to go to you. first of all did jpmorgan try to cover stuff up. we heard the testimony of this guy before. second of all when did they know. that's what i want to know. >> they knew they had internal control problems across spectrum of businesses -- >> way before this broke. >> they had reason to believe there were problems in that unit in 2009 and 2010 specific to these expo thursday seems the
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ceo and chairman and cfo knew there were problems in january and february of 2012 and ignored the alerts. >> way before jamie dimon said 10%, is that fair? >> that's fair. what i think is the right way of framing it is the alarms went off, they were elevated to his office three times the alarms went off. he told someone else to go figure out whether there was a fire but never checked back into the see if the building was burning. >> go ahead, michelle. >> what's significant today. they knew there were problems. hats significant today we're now asking was there a cover up and how long did it go on. this is a shift and it's always ultimately the problem. >> you're so right on target. bill isaac let me go back to michelle's point and josh's point. it has been reported that jamie dimon stopped the daily p and l reports to the federal reserve
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over office of control or currency whichever one. he stopped it. and then when they were resumed a few weeks later he blew his top at that resumption. so what josh is saying and what michelle is saying is that there was a cover up here and that is the thing that's going to sink mr. dimon who is a friend, a good guy, i have no vendetta. i don't know what it will do to the rest of the bank. but that's a big problem, is it not? >> larry, if there were a cover up of course that's a huge problem. i would say that it doesn't ring true to me. these banks -- i mean i've been in the banking world all my life and you can't cover things up with the regulators without a bad result in the end. and i believe that at the top of the house of chase, i don't know what maybe had gone on in the bowels of the organization. but they knew the way they can create a serious problem for
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themselves and their institution is not to be forth coming with regulators. it would be insane to do that. >> that's what's been reported. i'm going say in a long story by the bloomberg news service that's what was reported. josh is confirming that. michelle you're asking that question whether it happened or not. >> i guess i would ask mr. isaac, if all the facts have been laid out are true they stopped sending these reports the their regulator at the behest of jamie dimon and then even though they were asked for them weeks later they didn't start giving them back until weeks later how would you read that as a regulator when they stop giving you information they are asking for. >> if i were a regulator i would be all over them if they stopped report or didn't provide some information aasked for. frankly i don't know how that could happen from the regulatory side. i don't know how they can sit
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back we're not getting this report but it doesn't matter. that's a serious regulatory failure. >> that's a fabulous point. we set up a system so if a federally chartered bank who is their regulator, occ. if a federal lie chartered bank wanted to get a new line of business they went to the occ and said can i do that. guess how many times the occ to a federally chartered bank you can't go into a new line of business? not once. that's a failure on the part of the regulators. >> they the problems in the model -- they have internal control problems. to blame the regulator is fair -- >> i blame the regulator for all of it. >> at the end of the day you should be blaming shareholders as well. >> but is jpmorgan worse than the other banks? >> i would say from what i've
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looked at they certainly got more outstanding wishs the regulators. >> i want to say this. a regular business, a regular business makes a mistake. they pay for it. the shareholders and investors lose their money. in this case, banking is not a real regular business that's my bottom line point. with respect to risk taking and day-to-day business decision, yeah they got shareholders. but the real guys are the taxpayers that are going to have to pony up just like they did before. everybody thinks the world of jamie dimon and so do i but this is why the volcker rule and risk taking becomes so important stuff that i don't like. regulatory stuff i can't stand. if it's a taxpayer bailout too big to fail we have to do it. it's not free market capitalism. >> it's not. >> these are government-sponsored enterprises like the two that failed. >> bingo. josh ross near and bill isaac thank you very much. next up i'll break down latest
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reason why i'm optimistic about the economy. you ought to be optimistic too. i'll try to put us all in a better mood.
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it's digital, uh, pretty cool right? maybe. you know why i pulled you over today? because i'm a pig driving a convertible? tail light's out.. fix it. digital insurance id cards. just a click away with the geico mobile app. . big manufacturing number today up 0.8%. keeps that economic momentum going. my theme is still an optimistic theme. check this out. this industrial production manufacturing. three month change. all i want to say is from the
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summer, from the middle of 2012 look at that move. big upward move. that continues. second point, i'll clear. now we go to the second one. business equipment production this is capital goods production. very important. same story. from last fall you having a rebound, very, very important. i can read this from my pal? in the last two weeks we've seen isms, adp, payrolls, jobless claims, retail sales and industrial production all beat expectations. that should tell you the economy is doing better than you think and that's helping the stock market. that's my quick take on the economy. i'm not the only one. listen to actress mila kunis. >> i'm an advocate put things in the bank, lock it in a cd and be safe. i've been push forward to take chances and i'm learning a little bit about the stock
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market and companies. >> all right. my kind of gal. i'm not being political one iota. i'm looking at the data. you look at the data and you'll see what i see. the economy is getting stronger. we'll be right back. up next the question will be are the young gun libertarians taking the leadership role at cpac so far? we're going to talk about that with one under 35 elected leader from florida. stay with us, cpac story very interesting. [ male announcer ] i've seen incredible things. otherworldly things. but there are some things i've never seen before. this ge jet engine can understand 5,000 data samples per second. which is good for business. because planes use less fuel, spend less time on the ground and more time in the air.
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welcome back to "the kudlow report". in this half hour, another hidden cost of obama care is no longer hidden. employers will have to pay an additional 63 bucks per year for every person they employ and that comes to $25 billion nationwide and that is on top of the exploding cost to cover all the rest. but first up mitt romney passed the torch of the future of the republican party to the annual conservative political action committee. mitch mcconnell called republicans to stop being cry babies. let's check in with robert costa of the national review. he's been covering cpac all day.
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robert, late breaking poll from the newspaper. i want you to hear this. this is from the shows when it comes to budget cuts 65% of voters prefer spending cuts to raising taxes. okay. spending cuts. however, when asked which party they trust more on budget, democrats have the edge. what's wrong here? why can't the conservatives and the republicans make the sale? >> reporter: i think mitch mcconnell is a fine cpac friday don't be a cry baby caucus. yes it's post-election yes they were defeated but surprisingly optimistic here at cpac. >> surprisingly optimistic. give me a take on that. i was asking ann coulter about this earlier. she wasn't so sure it was optimistic. are they talking growth. are they talking jobs. are they talking economy. or are they attacking each other, robert? >> reporter: they are pretty optimistic on the growth message larry,.
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they are talking about spending cuts. today mitt romney made his first speech since his defeat, came back and has had a long and complicated relationship with conservatives. other big speakers, paul ryan and he did talk a lot about the growth agenda for the republicans and the budget. >> all right. let's bring in will weatherford florida state house speaker, joining the cpac panel tomorrow. a rising gop star under 40 years old. like robert costa. i wish i could say the same. say with us jimmy williams and michelle caruso-cabrera. let me ask you. there's a lot of talk. maybe b.s. from the media there's a split between somehow the old guard conservatives and the young guard of libertarian types. is that true? is that a rand paul thing? what's up with that? >> well i'm sure that's what the democrats want everybody to believe. the truth is the well conversation here is about freedom, economic freedom,
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personal freedom. this isn't about saving a party this is about saving the idea of america. what we're hearing about people young and old, libertarian, conservative, republicans we're all coming together to talk about how do we build this party back to what we know kit be for our country. >> are you a libertarian? >> i have some libertarian views on some things. it's not about being libertarian or being a republican. it's about a country that has a $16 trillion deficit. a country that's spending way too much money pap president that doesn't get it. we're here conferencing to say how can we articulate to the american people that our message of more freedom of economic and personal is the right way for this country to go. >> mr. speaker this is jimmy williams. former governor bush, jeb bush from your state said today in the "wall street journal," republican party must not write off entire segments of american society by assuming that its principles have limited appeal. you just said freedom. i like the idea of freedom. should i have the freedom to get married. should my girlfriend or my
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girlfriend that i don't date should she have the ability to go and have a consultation with her doctor and have that freedom. this issue of social issues is dragging your party straight into the toilet. when your goes going to figure out that you got to get off that start and start doing what larry is talking about which is stay out of people's bedrooms. if you're wearing pajamas the government shouldn't be involved. if you're wearing a business suit that's fine. some regulation, pro growth. when is your party going to figure that out. you're sitting there with the conservatives. when will you figure this stuff out? >> we're figuring it out. what we figured out we're a big party. we got a big tent. we have senator portman who came out in favor of gay marriage. >> were you in favor of gay marriage. >> senator rubio said it should be left up to the states. the point is our party can be an inclusive party where it doesn't matter whether you're for or against gay marriage you can stable republican. that's the inclusive part. >> that's write have to disagree
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with you. you can't tell me as a gay man you want me to vote for you but then tell me i can't have the same marriage as you have. separate but equal is something the court struck down in 1954. >> everybody is entitle toured opinion. you have yours like senator portman has his. it doesn't mean we can't be in the same party. what we're talking about is we have the ability to be a much broader inclusive party than maybe what we've been and you'll see that going forward. >> i would like to echo that as a hispanic conservative. i often have looked -- i wrote a book because i was so frustrated that i felt like the party was being hijacked by social issues rather than face on the economy and growth messages and the party started to look like the
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anti-party, the anti-gay party. to say you're for freedom is a start. how will you brand that message across the country? >> that's what this country was found upon was economic freedom and those principles and i'm sure the demonstrate and people who don't share our party affiliation would like to make people believe we're drieded and against people. >> divided. the republican party is divided. it's divided. >> we're for the american people. >> bob costa i'm an old-fashioned guy. here's what i'm for bob costa you heard this before. a, i am pro tax cut. b, i am pro spending cut. c, i am pro national security. and let me just add for the record d, i'm pro-life. is there a split in those kinds of things? in other words did marco rubio disagree with rand paul on those issues when they both spoke yesterday? >> reporter: that's such a great point larry because when you're
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here at cpac it's easy to be consumed by the narrative of the conference. fight on gay marriage or immigration. bobby jindal said blow up the tax code. he was talking about tax reform. there's a big story about cpac being a circus and a lot of controversy and conservative divide but on fiscal issues and economic issues singing from the same hymnal. >> you can be pro all those things but to sit here and listen to people make it sound like they aren't liked. they aren't wanted. they are disliked by a party is so disheartening. as am i. >> i have been for years. >> reporter: if you look at who the keynote speaker is, we're standing outside of the gaylord hotel. the keynote speaker is jeb bush. just came out with an
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immigration reform. who was the big speaker yesterday? marco rubio. the republican party and conservative movement are definitely talking about reform and immigration. >> i just want to know because i was asking you before and you were talking about debt and deficits and so forth. that's not a growth message. and i worry sometimes that there's a little too much root canal in the modern conservative movement. you know what i mean? root canal without novocain. and the best way to get out of the deficit and best way to get out of the debt is to grow the economy and yes limit spending. i'm all for that. if that's what governor jindal said i hope so. when you become governor will i want you to have a growth message, don't forget that. don't let anyone talk you out of it. there's too much talk about deficits and debt in the republican party. people want jobs, will. >> larry, come on down to florida. as of today 1,000 people a day are moving to florida. we not only have a growth
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message in the florida we have a growth strategy and it's working. if you look where florida was three years ago and where it is today it's a different place. call me in two years and ask me what's happening in florida. it's a radically different place. >> heck, i'm going down in three or four months to get you back on the show. thank you very much. robert costa thank you. now a great week for stocks. 117 point gain for the dow. that's optimism. we're going to get to all that up next on kudlow. please stay with us. clients are always learning more to make their money do more. (ann) to help me plan my next move, i take scottrade's free, in-branch seminars... plus, their live webinars. i use daily market commentary to improve my strategy.
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has oats that can help lower cholesterol? and it tastes good? sure does! wow. it's the honey, it makes it taste so... well, would you look at the time... what's the rush? be happy. be healthy. let's turn to stocks. dow snapped its ten day winning streak closing down a modest 25 points. pretty good week for the stocks. nasdaq touched a 12 year high today. we keep breaking records. report. let's go to director of tjm institution all service and larry glazer from mayflower advisors. larry i have not seen you for a while. welcome back. during the break i was telling my friend michelle caruso-cabrera, i love talking economics with her. every data point is coming out better than wall street expects and on top of that corporate
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profits are at a world record and on top of that the dollar is strong. so what's your take? how do you interpret that? >> no question, larry. first of all that optimism is well founded. that optimism might need a little breather. optimism has been taryn and should be in the air with the stronger dollar. that's great for the consumer. the concern here is near term we may be running into headwinds. near term we may be challenged. we haven't seen the volume to show conviction, the vix the volatility index suggest as high level of complacency right before the market might need to take a breather. we haven't seen insider buying to show they believe in their companies. longer term the concern is much more about economic policy. when i saw that consumer sentiment data, you know what went through my mind you look at the respondents, they are worried about economic policy and tax policy. >> that consumer number, that was the storm. that was a brief jump in gasoline prices.
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see, jim, i don't acknowledge short term stock market stuff. i don't get it. i don't acknowledge it. this business cycle, this business cycle is going to go on for several more years, and so are profits. in fact the whole world economy has gone up. that's why i'm an optimist. punch a hole through that. >> i'm very optimistic about our economy. not very but at least mildly. one thing what i like about what larry said he said the whole thing and never mentioned that ugly correction word. every time i thought of that word it cost me a couple of grand. it put that word out of my vocabulary. i don't think the market will correct until we get one more flush of cash of people on the sidelines who are sick and tired of waiting for the correction and throw in the towel. >> the green back, king dollar. the currency, the world's
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reserve currency is for a change rising rather than falling. now i regard that as another sign of better economic growth. and you know what? i want to see bond rates rise. because that would tell me the real exchange rate, the real bond rate and the real economy are all getting better. what do you think? >> i think it's bullish if you see the green back rising and is accompanied by growth. that's the piece we need to see come in here. maybe growth will be better than people expect. that's a show me story. that's on the horizon. it's interesting on the growth story, it's the economic renaissance you see in energy and housing. those are out there. the components are out there. you could unleash that. it's looming. like molten clay that needs to come together. we got to get through washington, get through the head winds and see confidence come back and you can unleash the economic engine of this country. >> are you not putting money network because you're waiting
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to see? what will you do >> i'm still expecting you one more leg up. with volatility at the unbelievable low levels it is it's fairly easy to be conservative and mitigate risk but i'm expecting one more move higher and then i'll consolidate. like i said before i'm a long term bull. a year ago we could have said the only reason the stock market rallied is because of fed involvement. that's shifted. >> and profits. please do not -- >> and profits. >> profits are the mother's milk of stocks. fed can stand on its head and spit wood nickels but if you don't have profits the stock market is not going up. you agree with that jimmy williams >> do i. >> you ever see bernanke stand on his head and spit wooden nickles? >> i've seen that. >> when does the fed step back.
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look if this economy is real and the stock market is the real, when will the fed step back. we can stand on our own two feet. >> i want to ask about something that's remarkably important for the long term and it's a long term indicator. housing. there are pockets in this country where house is going through the roof. here in new york, new jersey, d.c., escalation clauses every single contract. what about the rest of the country. what about places like nevada, california, arizona, michigan what's happening with house. i don't know. you guys are smarter than me. tell me. >> larry, you want to take it? >> except for detroit all those places are doing well. >> buy now. detroit is really cheap. >> you can get a 5,000 square foot house for $42.50. >> look, as we say. a lot of this clearly you have to give the fed credit.
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what the fed giveth the tax man takes away. state taxes going up. fed level taxes going up. you're getting bidding wars in markets that were depressed. that's good news. you'll see new construction. that's so less verdict in the economy. that would be good news. look, in some cases you see people waiving mortgage contingencies. that's confidence that's been pent up. it's not widespread yet. >> housing is the single biggest story and -- >> house -- you're so right. >> i don't think this is a 6% growth economy but housing could get us to 3% growth which would -- jim you're the best. larry good to see you again. up next the once hidden tax cost of obama care keep coming out of the wood work like cockroaches. we got details on the latest massive tax just discovered from a monday regulation. stay with us to hear this story. it's a phoenix with 4 wheels.
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[ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪ and no matter where you are in life, ask your financial professional how lincoln financial can help you take charge of your future. ♪
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just when you thought obama care couldn't get any more expensive a new report out today says employers will have to pay $63 extra for every person they insure next year when the law takes effect. that's beyond the increased cost of covering them in the first place and it comes to $25 billion. get this, boeing, gm and ford already lobbying to change the fees. listen to this.
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so is the uaw and a whole bunch of unions. they are going to have to pay the fees because they are health care providers. let's go to grace marie turner, jimmy williams and michelle caruso-cabrera. grace, do we have that right? the unions are lobbying against this because they are going to have to pay this thing. >> opportunemones thought they were going get all these new members by having people forced to purchase health insurance and organize these workers. every time you turn around wait a minute we don't want this. we want a waiver from these early provision. we don't want to pay this tax. we don't want to pay this fee. we don't want to pay these other 19 taxes that are coming. every single one of these tax. a trillion dollars in taxes. >> this is an insurance company shakedown is it not? they got extra costs because they have these mandates to put on, pre-existing conditions. this is an insurance company shakedown. >> it's an insurance company
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shakedown but the medical device makers have to pay a tax. the health insurers have to pay a tax. the pharmaceutical companies have to pay a new tax. employers have to pay individuals 20 new taxes, larry. every single one of these taxes is a transfer payment from one person to another. but it's also increasing the cost of health insurance. the main thing that business wanted from health reform was to get their health care costs down and every time they turn around their costs are going up. the president said their costs would go -- the average family would pay $2,500 a year less for health insurance. already they are paying $3,000 more and most of the provisions in obama care haven't even taken effect. >> got jimmy williams. >> so, this whole thing is about pre-existing conditions insurance plan. >> right. >> the congress just defunded
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it, right? >> well there are two funds. there was a temporary high risk pool fund, $5 billion. that's run out of money. >> these aren't the cheapest people to insure. >> this is an additional $25 billion fund. ate slush fund so if one health insurance company gets a disproportionate share of high risk. >> if stead of taking this money and giving to it the insurance companies i have an idea. pump it into that pc ip program which john boehner, eric cantor, kevin mccarthy, mike burgess, the entire republican leadership of the house sent a letter to the administration don't get rid of my pc ip program. take the 63 bucks per person -- >> weren't they all for pre-existing. >> it was a republican idea. now that they defunded -- >> thought -- if you know
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something about this jump in. i thought, grace, they were going to have risk pool, sort of cooperative risk pools. >> they defunded that. >> this is a replacements. >> we'll have this slush fund for the exchanges and one of the things the company is mad about is that they are being taxed $63 for their employees, spouses, dependents and known goes in to fund the high risk pools in the exchanges primarily for individuals and small businesses. they are saying this isn't helping us out. >> the exchanges were defunded on new year's eve as part of the thing that biden and the others did. >> no. >> the state co-ops were defended on new year's eve. >> state co-opens they have a choice. >> state co-ops are different than these exchanges. >> the federal government is going to be -- for states that
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don't want to play the federal government will finance it, isn't that right? >> that's one of the issues. the obama administration asked for almost a billion dollars more to create these exchanges. >> do you see how mind numbingly complex this is. this is ridiculous. >> maybe if they make detroit tax-free we'll all go to detroit. i'm larry kudlow. i'm larry kudlow. we'll see you on monday. ing, while using less fuel. delivering whatever the world needs, when it needs it. ♪ after all, what's the point of talking if you don't have something important to say? ♪


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